PRODUCT SOURCING

Before beginning your search for

suppliers you should have a good idea
about the short fallings of the current
products being sold on Amazon. That
way you can source a product that is
better than the existing competition
selling on Amazon.

Finding the Right Suppliers:

When it comes to sourcing most people rely on
China as their first preference. However, there can
be some great benefits to sourcing outside of China
as well from countries like India, Vietnam, or Japan,
where you can get cheaper options for better quality.
So try to keep an open mind when it comes to
sourcing. Following are the websites that you can
use to find suppliers for your product

Websites: There are a number of websites that you can use to source
your products, the most popular by far is [Link]. It contains the largest database
of suppliers from multiple countries. The platform is simple and easy to use. You
can view the stats of each supplier and their corresponding rating on Alibaba. Try to
source from a manufacturer and not a trading company if possible. Also, try to source
from a manufacturer that specializes in specific niches or products. Other common
websites that you can source from include
 ● [Link]

● [Link]

● [Link]

● [Link] (For US suppliers)

Sending an RFQ:
Since Alibaba is the most commonly used website for
sourcing. Here I will share a template that you can use to get
quotes or RFQ’s (Requests for Quotes) from suppliers. You can
send a Word Document / PDF or an excel file to your desired
supplier with the following information included in that file.

TEMPLATE

Requested By Your Name

Email Enter your business email.

WeChat The most popular messaging app in

China, a lot of suppliers like to
communicate through that.

Whatsapp Commonly used messaging app.

General Name of Product Enter a simple name so it is easy to

translate.
Quantity Requested Your preferred quantity or MOQ.

General Product Description Please give a simple description of the

product including the improvements
you would like to see and also mention
you need to add a shipping barcode for
Amazon.

Dimensions of Product Mention the unit of measurement.

Requested Materials Ask for supplier suggestions as well

here.

Packaging Specifications Again mention the Amazon Barcode

and ask for custom packaging if you
want here.

Shipping Requirements Always mention getting the product

packed in cartons/cases.

Similar Product Links Mention good performing competitor

listing or listings you wish to imitate.

This is by no means a fixed template; you can add or subtract points as you feel.
This template will try to put forward all the expectations and the general
requirements that you want your supplier to fulfill.

Some General Tips about Suppliers:

Here are some general tips about suppliers and sourcing in general that I have
picked up over the years. Hope that these are useful to you in some way.
● Always try to verify your supplier.
Either by hiring a 3rd company or by
searching for their website. Make
sure they have the certification in
order to export that item to your
country. Usually, you need a supplier
to have a UL or CE certification. A site which you can use [Link]
[Link]/ to check which certifications your product needs.

● Always get samples of the product that you are sourcing from a supplier. Try
to get them from multiple suppliers and then compare and choose the best one.

● Ask your supplier for their business license. This makes you sound serious
and you can also check if they are a manufacturer or a trading company from
their license.
● Check your supplier on [Link] if they have any
history that you wanna know about.

● Ask your supplier which markets they have supplied and if they sold for
clients on Amazon before.
● You should also ask them for their monthly production capacity and ask for
how many workers they employ.

● Ask them if they have had any 3rd party audits both social and technical. You
should also ask them if they do in house testing for their products.

● Make sure to add the following terms to your agreement with the supplier
○ Tell them they can not use your images anywhere.

○ They can not use the samples of your product anywhere or send them
to anyone else.
 ● Make sure that you try to source from someone who would be willing to
replace defective products if they come from Amazon. Share your reports or
images with them as proof if you need to.

● Try to negotiate as much as possible and also check for prices on

[Link] to see if you’re getting a fair price.

● Try to negotiate terms like 30% down payment and 70% after the product is
ready to be shipped.

● Try to get your products inspected at the factory before it is shipped from
teams like [Link]
● Try to use as simple language as possible as there are language barriers that
can make certain phrases difficult to translate.

How much to Order:

I use a simple formula to calculate the initial inventory that I need to order.
There are other more precise ways to do this. This formula is simplified and may
vary depending on the units it takes you to rank your product.

Number of Units to Order = (Num of Days to Manufacture + Num of days

to ship + 30 days + 7-10 days for product launch) * Number of daily sales
you are targeting [This is usually the competitor ranked 5th - 6th on the
first page]
Note: You can round the number you get. So if you calculate 343 units you can
round that to 350 units. It is good to have extra units if any turn out to be defective.

Getting the FNSKU Barcodes:

Make sure once you have the order placed that you send the supplier the
FNSKU Barcodes so that he places them on every package that he makes for you.
Be sure to do this otherwise Amazon might penalize you for this. To the FNSKU
Barcodes follow these steps

● Go to your seller central dashboard. Click on

inventory and then add products.

● After that select the option to add a new product.

● After that Amazon will ask you to select your category type in the name of
the product on the search bar or check what category your competitors are in
and choose that category.

● After that Amazon will ask for some basic information about your product.
Make sure that you have a unique UPC for your product bought in your
business name. Always buy these from [Link]

● You don’t need to create an optimized listing at this point just fill in the
boxes where a triangle appears to make a very basic listing. Your goal is to
get the barcodes you can optimize the list later.

● Once all the essential information has been filled click on create a listing and
then wait for it to be created usually takes 15 minutes.

● Once the listing has been created go to manage inventory and there you will
see the suppressed listing which you created.
 ● After that click on the listing edit button and then select print shipping
labels.

● This will bring you to another window. Here select the number of labels that
you want to print and the form that you want them (PDF etc.)

● Finally, click on print labels and then send these to your supplier for pasting
on your products.

Purchase Order & Proforma Invoice:

A purchase order is a contract between yourself and your supplier about what
you want from the factory. It is usually a
two-pager for simple orders but will vary
according to your requirements.

A proforma invoice is a
preliminary invoice sent to the buyer
which shows everything that is being
made. Most of the time the supplier
makes it. Be sure to include some
important things in the invoice that the
factory might miss.

● Make sure the factory name and address are included as well as your
business name and address.

● Date and order number.

● Include your payment terms and methodology.

● Add photos of all the items with the quantity that you have requested. If the
product has various parts include a picture of each item.
 ● Make sure the packaging of the product is good and the quality of boxes is
good and mentioned in the invoice.

● Add a performance clause (that is every day the shipment is late you get a
1% discount).

● Specify if you want a 3rd party inspection and if you want to conduct a drop
test for the product.
● Additionally, add what would happen if the supplier fails the inspection test.

● Include shipping cost if applicable.

● Make sure the official CHOP seal of the factory is on the invoice.

After the item is shipped you need to be aware of these three documents.

1. A bill of lading

2. A commercial invoice
3. A packing slip

Make sure you have these documents after the item is shipped. So you don’t have
problems with the customs.

Packing for International Shipping:

Always mention the terms of the packaging of your product in the purchase
order and proforma invoice to make it easier for you to ship your item to Amazon.

● Make sure you are aware of Amazon box requirements (maximum sizes and
weight per box). Even though the Amazon limit is 50 lbs ( 22.5 kg) try
 avoiding cartons over 15 kg these are too heavy and may result in cartons
crushing each other while stacked.

● Make sure to ask the supplier to use double wall cartons. If you are
conducting an inspection make sure the inspection team checks the quality
of the box or ask the supplier to send you pictures of the boxes used.

● Make sure that your product cartons/cases have the right shipping
labels/marks. These can vary from the type of product you are sourcing. For
more information on labels visit [Link]
guide/.